Infrastructure as a Service: Cloud Hosting Marketspace

The business of supplying cloud services to corporations certainly looks promising. Technology research firms are forecasting that the market for cloud services will expand at a dizzying pace over the next several years.

The logic  — remotely providing computing, data storage and applications as a service — is compelling. Customers don’t have to buy all that hardware and software themselves, and suppliers gain the efficiencies of running large-scale data centers for many different customers.

In this blog, let’s consider some key trends to build clarity around Infrastructure-as-a-service.  I review this marketspace and highlight some innovative cloud infrastructure vendors that are carving out a niche for themselves.

Storage-as-a-Service: Cloud Storage Providers

Cloud Storage has been increasing in popularity recently due to many of the same reasons as Cloud Computing.

Cloud Storage delivers virtualized storage on demand, over a network based on a request for a given quality of service (QoS). There is no need to purchase storage or in some cases even provision it before storing data. You only pay for the amount of storage your data is actually consuming.

Cloud Market Sizing – Factoids for Business Case

“Predicting the future is pointless, but it is possible to identify trends that have significant effects.” Peter Drucker

The increasing adoption of cloud computing and penetration of mobile devices are the two inter-related trends transforming the IT industry today. 

We’re in the midst of a “once-a-decade” technological transition where the Cloud has become a new platform for delivering resources such as computing and storage to tethered and untethered customers on demand.

So the question facing managers and strategists — What does cloud trend (IT-as-a-service) mean to our organization? What is the current penetration of cloud computing and how is it expected to change in the next one to three years?

Cloud Enabling IT-as-a-Service

Computing is going the way of a power utility.  This evolution parallels other big shifts like manufacturers, business and households moving to the electric grid from dedicated powerplants (i.e., windmills and waterwheels).

Today, similar shifts are happening in computing as dedicated (expensive) data centers are giving way to a computing and storage grid model. The maturation of the Internet, Web and networks are the ultimate catalysts.

Rather than being a new technology in itself, the cloud is a new business model wrapped around new technologies such as server virtualization that take advantage of economies of scale and multi-tenancy to reduce the cost of using IT resources.

Cloud is simply the manifestation of a broader transformation trend: “IT-as-a-Service.”  The services (applications, platforms and infrastructure) simply reside in the cloud and are consumed as a service. The “IT-as-a-Service” trend in its infancy and will take a decade to play out similar to e-commerce.  Early adopter companies are making their move to the cloud today, and they’re doing it aggressively to get a performance advantage.

Cloud computing is more of a service and business model shift than a technology. It is my belief that the cloud is, at its very essence, a service delivery and consumption model shift.  The value migration is clear and stark. We will see a steady erosion in value migrating from the previous “behind-the-firewall” business model to a new outside-the-firewall” business model.  A cloud landscape view is shown below.